Why buy a second hand auto
'Used', 'second-hand' and 'pre-owned' are all terms commonly used to refer to a car that's had at least one previous owner. But just because a car is second hand, it doesn’t mean that it is second-rate. This buyers guide is devised to help anyone in the market for a used auto. They’ll be posts with tips and helpful pointers for anyone investing in a used car. Whether you’re a novice tyre kicker, or a seasoned auto professional, there should be something helpful for everyone.
Buying a used car is often the smartest choice. And it can be a very smart option - if you choose a 'nearly new' model, you can own a car of the same quality and specification as a brand new motor, but at a significantly reduced price. A used car can offer the consumer fantastic value for money due to the wonders of depreciation.
Depreciation works to the used car buyer's advantage. Many popular cars lose one-third of their value in their first year; and after three years, it's quite rare for even a prestige model to be worth more than half its original new price. The good news doesn't stop there: between the third and sixth years in most cars' lives, the depreciation graph flattens out rapidly, older used cars lose a far smaller proportion of their value in real cash terms. Buy second-hand and the person who bought it new will have suffered the biggest chunk of its depreciation. Second-hand can make luxury affordable. For the price of a very small new car, you can buy a much bigger second-hand model with extra-plush features.
Not to say that there aren’t any pitfalls in the used car marketplace. The significant downside to buying a used car is risk. Risk of buying an unreliable car that will eat up money in repair bills. Risk of ending up with a stolen car or a write-off. Risk of being ripped off. Even experienced used car dealers can get caught out buying second-hand and end up with a dud. There's the danger of 'clocking' - the scam whereby dealers wipe miles off the car's odometer to increase its value. It is estimated that 14% of used cars on the market have been clocked.
The biggest risk with the used car market is that should the situation turn pear shaped, you may not be able to recover your money and you may end up losing the car as well. Legal protection is very limited when buying a car privately from a member of the public. Unless you are very knowledgeable and don't mind haggling, there is always the possibility you will pay too much for the car. If you're buying used, play it safe and pay for a professional to check the car out and for an independent warranty.
In posts to come, I’ll provide some helpful information to minimize the risk of purchasing a dud. Provided that you can do a sound background check on the car and have confidence in its mechanical ability there really shouldn’t be any reason for you to lose out on the financial benefits of purchasing a second hand auto.
Buying a used car is often the smartest choice. And it can be a very smart option - if you choose a 'nearly new' model, you can own a car of the same quality and specification as a brand new motor, but at a significantly reduced price. A used car can offer the consumer fantastic value for money due to the wonders of depreciation.
Depreciation works to the used car buyer's advantage. Many popular cars lose one-third of their value in their first year; and after three years, it's quite rare for even a prestige model to be worth more than half its original new price. The good news doesn't stop there: between the third and sixth years in most cars' lives, the depreciation graph flattens out rapidly, older used cars lose a far smaller proportion of their value in real cash terms. Buy second-hand and the person who bought it new will have suffered the biggest chunk of its depreciation. Second-hand can make luxury affordable. For the price of a very small new car, you can buy a much bigger second-hand model with extra-plush features.
Not to say that there aren’t any pitfalls in the used car marketplace. The significant downside to buying a used car is risk. Risk of buying an unreliable car that will eat up money in repair bills. Risk of ending up with a stolen car or a write-off. Risk of being ripped off. Even experienced used car dealers can get caught out buying second-hand and end up with a dud. There's the danger of 'clocking' - the scam whereby dealers wipe miles off the car's odometer to increase its value. It is estimated that 14% of used cars on the market have been clocked.
The biggest risk with the used car market is that should the situation turn pear shaped, you may not be able to recover your money and you may end up losing the car as well. Legal protection is very limited when buying a car privately from a member of the public. Unless you are very knowledgeable and don't mind haggling, there is always the possibility you will pay too much for the car. If you're buying used, play it safe and pay for a professional to check the car out and for an independent warranty.
In posts to come, I’ll provide some helpful information to minimize the risk of purchasing a dud. Provided that you can do a sound background check on the car and have confidence in its mechanical ability there really shouldn’t be any reason for you to lose out on the financial benefits of purchasing a second hand auto.
